Impact on cost control is public buyers' biggest Brexit concern

Brexit will have the highest impact on the public sector’s ability to control costs, according to research.

A survey by iGov and consultancy BiP Solutions revealed public procurement leaders’ predictions and concerns around the impact of Brexit, including lack of preparations, lack of control over costs and supply chain disruptions.

Out of the 80 organisations questioned, including those in the NHS, higher education and housing, 66% said there would be a high or medium impact on their ability to control costs. More than half (56%) felt Brexit would impact their organisation's ability to engage with suppliers outside the UK.

The survey found there has been a lack of preparation, with 66% most concerned with the “degree of planning and preparedness” across their supply chain. Almost half of respondents said they still did not have a “defined Brexit strategy” for managing supply and only 20% had a strategy for a no-deal scenario.

A senior operations manager at a housing association in London said: “Your questions ask what we ‘believe’ and that is the biggest problem; it’s all guess work. Nobody knows what the impact will be, but industry and governments will not stop with or without a deal. Things will just change, some better, some worse.”

Clarity around the extent of Brexit’s impact has been limited, with 56% of respondents most concerned by the “current uncertainty and its impact on effective planning”.

A procurement officer at North West England NHS said: “Solutions can only be put in place when the scale of the problem is clearly documented.”

Public procurement professionals also highlighted the impact of Brexit on supply chain disruptions, with 61% concerned about the effect of disruptions on delivery and quality of services.

More than half (58%) of procurement leaders felt that a no-deal Brexit would be “significantly worse” for public sector procurement strategies. Meanwhile, a third believed the impact on procurement between a no-deal or negotiated Brexit would be “no worse or better”.